U.S. Senators Cindy Hyde-Smith and Chuck Grassley are urging the Biden administration to make full use of a federal program designed to support struggling rural hospitals. The senators have sent a letter to the Centers for Medicare & Medicaid Services (CMS) regarding its underutilization of the Rural Community Hospital Demonstration (RCHD) program.
The letter highlights that although current law permits up to 30 hospitals to participate in the RCHD, CMS has not filled all available spots, leaving as many as eight vacant. “Current law allows up to 30 hospitals to participate in the RCHD, but for the past several years CMS has underutilized the program leaving as many as eight spots vacant,” wrote Hyde-Smith and Grassley. They added that despite interest from additional rural hospitals, CMS has not acted to include eligible facilities.
The senators pointed out performance data indicating improvements in Medicare margins for new RCHD hospitals, suggesting financial benefits for these institutions. “The most recent performance data suggests that new RCHD hospitals significantly improved their Medicare margins,” they noted.
Hyde-Smith and Grassley emphasized that CMS should maximize its resources to aid rural hospitals facing financial difficulties. “The RCHD program is supporting rural hospitals and it should be fully utilized,” they concluded.
The letter also references commitments from Health and Human Services Secretary Xavier Becerra, who promised collaboration with lawmakers to enroll more at-risk rural hospitals into the program during an April appropriations subcommittee hearing.
Established in 2003, the RCHD program was reauthorized three times and employs alternative payment models for rural hospitals challenged by the Medicare Inpatient Prospective Payment System. CMS last sought applications for this program in 2017.
Facilities such as Anderson Regional Medical Center in Meridian, Highland Community Hospital in Picayune, and Marion General Hospital in Columbia are currently participating in testing innovation models through RCHD.
